Stochastic scheduled service network design in the presence of a spot market for excess capacity

Xin Wang and Stein Wallace
Additional contact information
Xin Wang: Lancaster University Management School

EURO Journal on Transportation and Logistics, 2016, vol. 5, issue 4, No 2, 393-413

Abstract: Abstract We study the impacts of a priori knowledge of spot markets for excess capacity on stochastic service network design problems. We do this by investigating whether it is beneficial to take spot markets into account at the design stage when building a transportation plan facing uncertain demands. We show that in most situations, taking spot markets into account at design level reduces the total costs, not just from the benefit of selling excess capacity, but also from changes in the design of the service network itself. We also show that when deterministic models are used to produce solutions for stochastic service network design problems, introducing spot markets at the design stage has undetermined effects. This is important since in most real cases, only the deterministic models can actually be solved. We only study cases where it would not be profitable for our vehicles to operate solely in the spot market as the income per capacity unit is much lower than our costs per capacity unit; the spot market is a means to obtain some income from excess capacity, but it is not our primary market.

Keywords: Service network design; Stochastics; Spot market (search for similar items in EconPapers)
Date: 2016
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

Downloads: (external link)
http://link.springer.com/10.1007/s13676-015-0089-1 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:eurjtl:v:5:y:2016:i:4:d:10.1007_s13676-015-0089-1

Ordering information: This journal article can be ordered from
http://www.springer. ... search/journal/13676

DOI: 10.1007/s13676-015-0089-1

Access Statistics for this article

EURO Journal on Transportation and Logistics is currently edited by Michel Bierlaire

More articles in EURO Journal on Transportation and Logistics from Springer, EURO - The Association of European Operational Research Societies
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().